Mozambique: Modernization of Tmcel network by May costs US$132 million

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Mozambique: Modernization of Tmcel network by May costs US$132 million

6:37 CAT | 15 Sep 2023

File photo: Domingo

The president of the Tmcel management committee, Mahomed Adamo Mussá, said on Thursday that the Mozambican state-owned telecommunications company was experiencing a “new rebirth”, as part of the IS$132 million revitalization of operations scheduled to last until May, 2024.

“The first two months were to draw up an 18-month plan to reverse the company’s situation (…) That’s what we’re going to do: a new rebirth,” Mahomed Adamo Mussá told the press in Maputo today.

Last May, the shareholders of the mobile and landline telecommunications operator approved a management committee and plans to revitalise the company and reduce costs, as well as a study on the profitability of cost centres, just days after the minister in charge had warned parliament of Tmcel’s imminent near collapse.

Four months later, at today’s meeting, the administration dismissed this scenario, revealing growth in several indicators with the inclusion of new products and claimed that the project to expand and modernise Tmcel’s telecommunications network, budgeted at US$132 million (€123 million) and financed by China’s Eximbank, with completion scheduled for May 2024, was already 57% complete, including, among other investments, the installation of 778 of the 1,300 envisaged telecommunications signal transmission antennae.

“The new management committee started working in May and focused on stabilising the network and the network is already starting to be stable. We have zero sites [antennas] with problems, for example, with energy. We have network availability above 97% and our tendency is to reach 100%, this is the way forward,” explained Tmcel’s marketing director, Adil Ginabay.

Still within the scope of the modernization and expansion of the network, which began in January 2022, after “almost ten years without investment”, Tmcel, which operates a support network of 7,600 kilometres of optical fibre and 8,500 kilometres of access networks, has already increased broadband coverage from 10 to 400 gigabits per second (Gbps).

“We have already covered the country’s provinces, with the exception of Niassa, with the new 4.5G network,” Ginabay added.

Currently, Tmcel’s market share in Mozambique is 10 to 12%, in terms of active customers, but the objective assumed today by the management committee is to exceed 25% in the medium term.

“All these steps, combined with the expansion and modernization of the network, will mean increasing results for the company. At the moment, August was the first month that we managed to cross the same month of 2022, in terms of recharge, we went up 7%. For us it’s a victory, because it hasn’t happened for a long time,” he said.

Tmcel currently has 1,419 workers, having in 2019 instigated a process of voluntary redundancy that led to the departure of 526 employees.

Currently, it was further advanced today, a second phase of this process is underway, with the operator expected to reach June 2024 with around a thousand workers, through voluntary terminations and layoffs of employees.

The Minister of Transport and Communications of Mozambique, Mateus Magala, said in May, in parliament, that Tmcel faced the risk of “collapse” without immediate and urgent measures for its financial recovery, including in terms of paying salaries to its many workers , having “an accumulated global debt of more than 400 million dollars (365 million euros), with a tendency to worsen”, he declared.

Tmcel’s management committee clarified today that the financial situation “is under control”, that it has been “honouring its commitments”, with the objective of “clearing the debt”, but recognizing that it is still a “long process”.

Source: Lusa